Bidiversity

Originally published in Smart Business, this article summarises Kerry Kramp’s approach to running a business: being hands-on; he recommends his methods to anyone looking to revitalize their company. The CEO of Los Angeles-based Sizzler USA Restaurants, Kramp took over two years ago at a time when annual sales were plummeting. To increase sales, he turned to customers and employees (his internal customers) for direction…

Maybe you were staring at the six-panel menu on the wall at a Sizzler restaurant when a 6-foot-2 man sidled up next to you and asked how you were making your meal decision. Maybe he asked why you even chose the fast-casual steak, seafood and salad restaurant chain in the first place.

If so, you’ve met Kerry Kramp, who took over Sizzler USA Restaurants Inc. in June 2008, inheriting sales declining as much as 20 percent year-to-year.

He observed the Los Angeles-based chain — first as a competitor when he helmed HomeTown Buffet Inc. — then more intimately as a Sizzler board member for two and a half years. He came into the role of president and CEO knowing what Sizzler had tried to be.

Now, he needed to determine what Sizzler should be.

He began like an average customer would, and he invited HomeTown Buffet partner Dennis Scott to dinner to the tune of a $52 bill and good-enough food.

“The value-to-what-you-got equation was a little bit off,” Kramp says. “So it began a course of discovery to try to understand what really made Sizzler tick — not so much where the direction had been in the past as much as where the guests wanted Sizzler to be.”

Kramp suspended franchise sales so he could evaluate the company from its core. He melded internal employee opinions with external feedback in an effort to rebuild the brand, keeping Sizzler relevant as customers’ expectations changed and, in many cases, their wallets thinned.

“It was to try to understand the uniqueness of this 50-year-old company,” Kramp says. “Where it had been and, really more so, where everybody wanted it to be and how to make it relevant to the consumers that we would need to be attracting in this new world order with the economy changed the way it has.”

Get close to customers

Kramp learned something standing on the customer’s side of the menu: To discover what customers want, you have to get in their shoes. Seeing your company from the customers’ perspective means, literally, standing where they stand.

So he stood in line with Sizzler patrons, saw the offerings from their vantage point and asked them lots of questions.

“From the guest side, first it was to really understand what was important to them,” he says. “It was looking at: How do the guests want to use us?”

Start by observing as customers use your service and talk to others about it. Kramp watched customers as they examined their 50-plus menu options — often appearing overwhelmed.

“People came in, they ate their food, they might comment on a few things, they’d say it was good and then they’d head out the door,” Kramp says. “So it was a really vanilla kind of experience, which normally would be fine — unless you’re in the worst recession in history, then vanilla doesn’t always work.”

After observing, step in to learn more about the customer’s thought process.

“I would ask them questions about how they were looking at the menu and how they were deciding what they wanted, and then taking that further to see how the menu related to them,” he says. “Were there items on it that they wanted? Did they come for anything in particular? It was back to that discovery about why do people come to Sizzler and does Sizzler offer the things that they want.”

When discovering what customers want, it’s tempting to resort to surveys and focus groups — which Sizzler conducted before Kramp came on board. But don’t limit your research to hypothetical preferences in lieu of actual responses.

“Instead of asking people about what they aspirationally might want, we started feeding them food and then getting responses from them as to what they liked or didn’t like, and kept trying to evolve the recipes and portion sizing and pricing based on their response to stimulus rather than just questions about what they’d like to see,” says Kramp, who appointed Scott as chief of strategic development to test menus.

“You have to be true to that consumer and find ways to embrace them: ‘What are you willing to do? If you’re not willing to spend any more money, are you willing to have less portion? Or are you willing to pay a little bit more for better quality?’ If you don’t really engage the guest to be relevant to them, you may think you’ve fixed the problem but actually created a credibility gap.”

You can’t talk to every single customer, so in addition to direct interaction, keep an eye on data like sales volumes. Knowing what and how often they order certain things can keep you attuned to preferences, even if you don’t always have the anecdotal “why.”

“We kept our finger right on the pulse of the guests’ feedback,” Kramp says. “As they gave us indications of what they liked — either verbally or through the product mix, what were they ordering — we kept adapting our business to the direction that they wanted us to head in.”

Read the rest of the story here.